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Originally posted by shankaracharya



How about Oakville, Milton, Cambridge, Orangeville, Georgetown and some places enroute to US of A for starters ?.

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Chandresh

Advice is free – lessons I charge for!!

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Originally posted by chandresh
I have the same feeling - and in last three months, I have invested into two houses - one a semi-D in Milton and another a detached but small house in Bradford. Both are below 300K but have great layout!
Chandresh

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I am a Gents and not a Ladies.

Quote:

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Originally posted by tamilkuravan

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Originally posted by chandresh
I have the same feeling - and in last three months, I have invested into two houses - one a semi-D in Milton and another a detached but small house in Bradford. Both are below 300K but have great layout!
Chandresh

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Are the 2 properties let out for rent? Has it been easy to find genuine renters?

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Chandresh

Advice is free – lessons I charge for!!

Mortgage 101


The purchase of a home is one of the biggest decisions and significant financial investments a consumer makes. It is extremely important that you do your research and educate yourself on key mortgage terms in order to make an informed decision about what mortgage product is best for you.

Different consumers are at different stages in their lives. They have different mortgage needs and there are many mortgage products to choose from. The best result will occur when you work with a mortgage professional who can offer sound, professional advice and a mortgage solution that matches your needs and circumstances. Above all, you need to be comfortable with your mortgage choice.

PRE-APPROVAL
It is important to obtain a pre-approval for the amount of money you can borrow from a lender and avoid looking at homes that may be out of your price range. The pre-approval process is usually guaranteed for a period of 90 days. For additional security for the lender, you may want to have a co-signer – a party who signs the mortgage documents along with the borrower, but who does not have any interest in the ownership of the property.

WHAT IS A MORTGAGE?
Few people can come up with the entire amount of money required to pay for the cost of a home. A mortgage is a loan of the money most people require to finance the purchase their home. A mortgage allows individuals to buy property without paying the full value all at once. The mortgagor is the person borrowing money, the mortgagee is the lender of the money.

When negotiating the amount of your mortgage, you should be aware that you will most likely be required to provide a down payment which is the money you put towards the purchase price of your home. The amount of your mortgage is determined by the purchase price of the home less the amount of your down payment. As with all loans, a mortgage must be repaid to the borrower with interest. There are different types of repayment methods which make up the different kinds of mortgages available.

Like all loans, regular payments made over time go towards paying down the mortgage. These payments are made up of two parts – one part goes towards paying the principal (the amount of money borrowed) and other part goes towards paying the interest (the fee charged for borrowing the money.)

The more money you can put down, the less you will have to borrow, and the less interest you will have to pay over the length of the mortgage.

If you have a down payment equivalent to 25% or more of the purchase price, you will have what is called a conventional mortgage.

If your down payment is less than 25% of the purchase price, you will have what is called a high ratio mortgage. A high ratio mortgage must be insured to protect the lender. This insurance is called mortgage default insurance. It protects the lender in case the borrower isn’t able to repay the loan.

The Canadian Mortgage and Housing Corporation (CMHC) and Genworth Financial offer assistance to first-time home buyers who do not have a lot of disposable funds for a down payment. Ask your mortgage professional for more details.


TERM OF MORTGAGE
The term of a mortgage is the length of time a lender will loan mortgage funds to a borrower. This duration can be from six months to ten years, two to five years being the most common. Generally, the shorter the duration of a mortgage term, the lower the interest rate, and the less it costs to borrow the money. At the end of each term, you will either pay off the balance owing or renegotiate the mortgage for another term until the entire mortgage is paid back.

Short Term
Short term agreements or mortgage contracts are usually for two years or less. Short term mortgages offer a lower cost of borrowing (interest rate) than a longer term. People who believe that interest rates are currently higher than they will be in the future generally choose a short term mortgage. They anticipate that interest rates will be lower at the time of renewal.

Long Term
Long term agreements are generally for three years or more. Long term mortgages cost a bit more than short term mortgages, so the interest rate will be higher. A higher interest rate appeals to borrowers who value the stability and predictability of fixed expenses over a set period of time. A stable mortgage payment is easier to budget and offers peace of mind.

It can take a long time to completely pay off your mortgage – usually from 15 to 25 years. The process of fully paying off your loan by installments of principal and interest over a definite period of time is called Amortization.

There are many ways of repaying your mortgage. Some people find comfort in a pre-determined fixed rate – it helps them budget and plan for other things in their life. Some people desire more flexibility in their repayment – their circumstances might include fluctuations in their cash flow, and they may want to make larger payments whenever possible. Different kinds of mortgages appeal to the different types of borrowers. Your mortgage professional can help you decide what is best for you.

MORTGAGE TYPES
Open Mortgages
If you want to make large payments on your mortgage or pay off the entire mortgage without penalty, then an open mortgage is for you. An open mortgage offers maximum flexibility. These homeowners are willing to accept some fluctuation in the interest rate for the flexibility of paying off the entire mortgage before the term is complete.

It is important to keep in mind that most regular mortgages will allow homeowners to make lump sum payments of up to 20% of the entire mortgage once a year without penalty. That payment goes directly towards paying down the principal of the amount borrowed. You may therefore not need an open mortgage, with higher interest rates, to make additional payments.

Closed Mortgages
A closed mortgage is a commitment with a pre-determined interest rate, over a pre-determined period of time. A buyer who uses a closed mortgage will likely have to pay the lender a penalty if the loan is fully paid before the end of the closed term.

With a closed mortgage, the interest rate will not change over the length of the term and the length of the term will not change. Payment amounts are predictable and the principal amount owing at the end of the term is predictable.

Closed mortgages generally have lower interest rates than open mortgages. Most closed mortgages will allow the homeowner to make a payment up to 15% of the entire mortgage once a year without penalty. This payment goes directly toward paying down the principal of the amount owing.

Convertible Mortgages
A convertible mortgage is an agreement made at the beginning of a term that allows homeowners to change the type of mortgage they hold during its term. If a homeowner wants to start with an open mortgage and then lock into a closed mortgage, a convertible mortgage is the right choice. It offers lower rates than an open mortgage, and has the option of switching to a closed term.


RATES
An interest rate is the amount of interest charged on a monthly loan payment, expressed as a percentage. It is based either on the rate the Bank of Canada charges to lend money to money lenders or on bond yields. Interest rates are generally lower if you borrow money for a short period of time and higher if you borrow the money for a longer period of time.

Fixed Rate Mortgage
When you agree to a fixed rate mortgage, your interest rate will never change throughout the term of your mortgage. There are no surprises as you’ll always know exactly how much your payments will be and how much of your mortgage will be paid off at the end of your term.

Variable Rate Mortgage
When you agree to a fluctuating interest rate for the length of the term, then you have a variable rate mortgage. Interest rates fluctuate with the bank’s prime lending rate, and may vary from month to month. When interest rates change, your payment amount remains the same, however the amount that is applied to the principal will change. For example, if interest rates drop, more or your mortgage payment is applied to the principal balance owing. The variable rate mortgage is a good option for homeowners who believe that interest rates are currently high and will drop.

HOME CLOSING TERMS
When you and the seller come to an agreement on the price to be paid for the house, you must provide a deposit. A deposit is an advance payment of part of your down payment and is paid at the time of signing the Agreement of Purchase of Sale.

The Agreement of Sale is a legal document the buyer and seller approve detailing the price & terms of the transaction.

When negotiating the cost of the house you want to purchase, it is important to keep in mind that you will also be required to pay property tax. Property tax is paid on privately owned property and is usually paid semi-annually or monthly. The amount is based on local tax rates and assessed property value.

Other than the deposit and down payment, you should keep in mind that you will likely also be paying for a home inspection – an examination of the structure and mechanical systems to determine a home’s safety and makes the potential homebuyer aware of any repairs that may be needed.

Considering insurance on your mortgage
Talk to your mortgage professional about insurance protection against your mortgage in case of death, accident or illness. There are many insurance options to choose from. Insurance is available to protect you and your family should you be unable to work.


PAYING OFF YOUR MORTGAGE SOONER
How to shorten the length of your mortgage and minimize the cost of borrowing
There are many benefits to shortening your mortgage, and thereby paying less for the cost of borrowing the money. You can free up money for other things in your life – the education of your children, money for your retirement or an emergency fund.

Make more payments. Increase the frequency of your payments. Ask your mortgage professional to show you how you’ll save by paying biweekly or weekly, instead of monthly. Paying more frequently can save you hundreds of dollars in annual interest costs.

Make the largest down payment you can afford. This will substantially reduce the length of time to it takes you to repay the mortgage. If interest rates decrease when it is time to renew your mortgage, consider keeping your payments the same and applying more money to the principal.

Make prepayments or anniversary payments. Most mortgages will allow you to make payments up to 20% of the entire mortgage once a year. This money is applied directly to the principal, saving you money in annual interest costs. Consider using your tax refund or annual bonus for this type of payment.

Make lump sum payments whenever your financial circumstances permit.

Double your payments whenever possible.

Choose a shorter length of time to repay your loan. Ask your mortgage professional to show you how selecting a 20 year amortization period instead of a 25 year amortization period will affect your payments and interest costs. Consider choosing 15 years to repay if possible. Your mortgage payments will be higher but you’ll pay substantially less interest over the course of the loan.

If interest rates have dropped when you renegotiate your next term, keep your mortgage payments the same. More money will go directly to paying down the principal.

TYPES OF HOUSES
Condominium – a form of ownership in which the homeowner purchases and owns a unit of housing and shares financial responsibility for common areas. (In British Columbia, these are also called “stratus”.)

Detached/Freehold – A property where you own both the property and the land on which it is built.

Townhouse – an attached home that is not a condominium.

LAST DETAILS YOU’LL NEED TO CHECK
You will be required to provide the following list of information to your mortgage professional to finalize the mortgage:

Confirmation of income or employment earnings
Current bank information
Evidence of your down payment
List of assets
List of liabilities
Contact information for your lawyer
Copy of the Purchase Agreement
Copy of the MLS listing
Contract and building plans if your home is being built

S. J. Kanji AMP
HLC/CIBC Mortgages Inc.
416 865 0411 x 2072
direct: 416 444 1470 or 1800 265 2694
salim.kanji@hlcmortgages.com

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S. kanji
I may not agree with your opinions, but I will fight to death for you be able to air your views.

Home Buyers Unite!

The below article is written by Michele Dawson for my September Realty Times Real Estate Newsletter. This article and many more home buying topics, news and advice can be seen at http://realtytimes.com/94/AmitKalia or on my website's home BUYER page incld. its hyperlinks http://www.realestate-ontario.com/buyers.htm Readers can feel free to subscribe this informative e-newsletter.

Don't Overlook a Home's Potential When House Hunting

Home shopping. For first-time homebuyers it's an exciting, albeit nerve-wracking, experience. If you're like others in the market for their first home, you probably have in mind exactly how your soon-to-be home will look.

But it's important not to fall into the bad decorating, dingy walls, and dirt-bare back yard equals bad-home trap. If you don't see past the hideous wallpaper, funky light fixtures, and avocado green carpeting, you may miss out on a home with great potential.

And, if you're looking for a home in a seller's market where homes are being snatched up as soon as they go on the market, you'll come to realize you can't be choosy if you want to make a competitive offer.

One of the first things to do is to get PRE-QUALIFIED for a loan and determine the maximum you can afford to offer for a house. Don't look at homes that are asking for more than 5 percent above your maximum, otherwise you'll be setting yourself up for disappointment if you find the perfect - but outside your budget - home.

So what to do?

The FLOOR PLAN of the home is extremely important. If a floor plan isn't quite to your liking, consider rearranging it or adding on. If you're looking at an existing home and will need to remodel or expand to suit your needs, the estimated cost of renovation should play a role in how much you offer.

Also, consider the features of a home:

WALLS: While walls are one of the easiest things to remedy, they also make a huge first impression. If the walls need to be painted, are covered in wallpaper, or are painted a color you find distasteful, picture them crisp and clean in the color of your choice - that's how they could look after you paint them.

FLOORS: Like walls, carpet or floor surfaces that are old or outdated can be easily replaced. You could even ask for a carpet allowance in your bid, especially if you're in a buyer's market.

VIEW: Things like old, ugly -even dirty - windows and window treatments can make a view appear less desirable. Those things can be improved, so unless the only view you have is of your neighbor's clunker on the side of the house, don't get hung up on what is surely a fixable view.

LANDSCAPING:. Your best bet is a moderately landscaped yard because you can always improve landscaping without spending too much. Worst case, even if you're looking at dirt, landscaping is one of the more feasible projects to tackle. Plus you get to design it however you'd like if you're starting from scratch.

CLOSETS AND GARAGES: You can never have too much storage space, which is why so many newer homes have three-car garages. But if you encounter a converted garage that is now a bedroom or storage room, don't give up. Converted garages can almost always go back to their original purpose without much cost or labor.

KITCHEN: The most popular room in the house, many homeowners want their kitchen to be large and have modern appliances. Don't let color schemes from the '70s detract you, because there's nothing like a fresh coat (or two) of paint to make a kitchen your own. Plus, if you like the rest of the house enough to make an offer, you can give the kitchen a minor spruce-up with some new appliances, or a major overhaul complete with new countertops, cabinets, and flooring.

EXTERIOR: If the home you're looking at doesn't have good curb appeal, try to picture it with a fresh coat of paint and spruced-up landscaping.

POOLS: If you want a pool, buy a home with a pool already built in. The cost of adding a pool starts around $25,000, and paying to add one later will never yield a dollar-for-dollar return on investment. The cost of repairing a pool is less than putting one in, so if you're looking at a home with an old pool that looks like it's in bad shape, it's still a better bet than putting one in later.

When making an offer, bear in mind the things that you can't live without, as well as your budget. Also, be sure you hire a professional home inspector to inspect the house. If the home's systems are in good working order and the house has everything you want except a minor item or two, make an offer accordingly.

Most importantly, keep in mind that unless you're building your dream home from scratch, you'll probably never find the perfect home. But seeing past a previous owner's bad decorating choices to the core of the home and its potential for livability will yield you the home you've always wanted. It may take some work, but hey - it's yours!

*********************End of article*********************

Let me add some other points to the above that are also considered vital when making a buying decision and they are: Neighbourhood, Envoirnment, Crime rates, Schools, Transportation, Amenities, Noise and Nuisances etc.

With some much information, news, websites, MLS data, advice from friends, family, peers etc. buyers tend to get overwhelmed with the whole process of home buying. It is always in their best interest to leave this job in the hands of professional Realtors who are trained in doing this work day in and day out.

Regards,

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Amit Kalia, Broker, REALTOR®
RE/MAX Real Estate Centre., Brokerage
independently owned & operated
100 City Centre Dr, Unit 1-702
Mississauga, ON L5B 2C9
Phone No.: 905-339-5111
Website: https://www.realestate-ontario.com/
Condo Blog: https://condopundit.com/blog/

How Much will it Really Cost?

Once you have figured out the home price range you can afford and the type of mortgage you qualify for, you will need to calculate all of the associated costs of the transaction to make sure you are financially ready.

Up-Front Costs
You will need to plan ahead to cover the many up-front costs of buying a home. Timing is important to help make sure things go smoothly.
Mortgage Loan Insurance Premium. If yours is a high ratio mortgage (less than 25% down payment), you may need mortgage loan insurance. To get this insurance, you will be asked to pay the required insurance premium. Your lender may add the mortgage insurance premium to your mortgage or ask you to pay it in full upon closing.

Appraisal Fee. Your mortgage lender may require that the property be appraised at your expense. An appraisal is an estimate of the value of the home. The cost is usually between $250 and $350 and must be paid when you contract for those services.

Deposit. This is part of your down payment and must be paid when you make an Offer to Purchase. The cost varies depending on the area, but it may be up to 5% of the purchase price. If you wish to make a down payment of 5% and you give a deposit of 5%, then your down payment is considered to be made.

Down Payment. At least 5% of the purchase price is usually required for a high-ratio mortgage and at least 25% of the purchase price is usually required for a conventional mortgage.

Estoppel Certificate Fee (not applicable in Quebec). This applies if you are buying a condominium or strata unit and could cost up to $100.

Home Inspection Fee. Remember that this may be a condition of your Offer to Purchase. A home inspection is a report on the condition of the home and may cost over $200, depending on the complexities of the inspection. For example, it may be more costly to inspect a home that has large square footage, one that is expensive or one where contaminants such as pyrite, radon gas or urea-formaldehyde are suspected.

Land Registration Fees (sometimes called a Land Transfer Tax, Deed Registration Fee, Tariff or Property Purchases Tax).You may have to pay this provincial or municipal charge upon closing in some provinces. The cost is a percentage of the property's purchase price and may vary. Check with your lawyer/notary to see what the current rates are.

Prepaid Property Taxes and/or Utility Bills. To reimburse the vendor for pre-paid costs such as property taxes, filling the oil tank, etc.

Property Insurance. The mortgage lender requires this because the home is security for the mortgage. This insurance covers the cost of replacing the structure of your home and its contents. Property insurance must be in place on closing day.

Survey or Certificate of Location Cost. The mortgage lender may ask for an up-to-date survey or certificate of location prior to finalizing the mortgage loan. If the seller does not have one or does not agree to get one, you will have to pay for it yourself. It can cost in the $1,000 to $2,000 range.

Water Quality Inspection. If the home has a well, you will want to have the quality of the water tested to ensure that the water supply is adequate and the water is potable. You can negotiate these costs with the vendor and list them in your Offer to Purchase.

Legal Fees and Disbursements. Must be paid upon closing and cost a minimum of $500 (plus GST/HST).Your lawyer/notary will also bill you direct costs to check on the legal status of your property.

Title Insurance. Your lender or lawyer/notary may suggest title insurance to cover loss caused by defects of title to the property.

If you feel you cannot cover all of the up-front costs, you can ask your lender for a loan. Remember that payment for this loan amount, based on a 12-month repayment period, will have to be included in your calculations. First Canadian Title (FCT) will insure and also loan you upto $10,000. in closing cost at a very nominal charge. FCT is doing this a selling tool to sell their product to the Lawyers.

Other Costs
Besides up-front costs, there are other expenses to consider:

1. Appliances. Check to see what comes with the house, if anything.
2. Gardening equipment.
3. Snow-clearing equipment.
4. Window treatments. Check to see what comes with the house.
5. Decorating materials. Paint, wallpaper, flooring and tools for redecorating.
6. Hand tools. You will need some basic hand tools for your new home.
7. Dehumidifier. May be required to control moisture levels, especially in older homes.
8. Moving Expenses.
9. Renovations or Repairs.
10. Service Hook-Up Fees. Charged for utilities. You may be required to pay a deposit for utilities such as telephone and heating services.
11. Condominium Fees. You may have to make the initial payment for these monthly fees.



Contribution by : Salim J Kanji BA AMP 1 800 265 2694
CIBC Mortgages Inc.
(PLEASE DO NOT CALL ME FOR INVESTMENT PROPERTIES- ONLY OWNER OCCUPIED HOMES-THANKS)

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S. kanji
I may not agree with your opinions, but I will fight to death for you be able to air your views.

Hi CD Home hunters,

Besides, the usually search criteria, it's a wise decision to look at some 'out-of-box' options. They are:

1) Getting your home built by a builder:
One of my friends recently purchased a brand new semi detached from a realtor. Later he dicovered that the same model of home was sold for 30,000$ less directly from the builder . There are a quite a number of people getting their homes built this way.
PROS:
a) Its just you and the builder. you save around 20% cost in agent fees, realtor cost in this transaction. Substantial cost savings!!
b) you can get the house built as per your ideas.
Cons:
a) Periodic down payments may be required.

Please shed light on this situation. Have you gone this route? what else are the cons?
Chandresh , the 'to-be owner of two new constructions' may kindly enlighten us.

2) Private sale:
Here you will be directly interacting with the seller himself.
The below article says that buying from a private sale is another good idea
http://www.readersdigest.ca/mag/2001/05/bargain.html
They estimate a savings of around 15,000$ if you split the cost between you and the seller.

Has anyone gone this route? Please list your experiences for everyone's benefit.

Regards,

seenappa